Dairy management changes may offer answers to butterfat equation

Enhancing ventilation may be one of the most cost-effective ways to increase butterfat content in a herd’s milk over the long term instead of using feed additives, according to two experts from Lactanet.

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Economist Simon Jetté-Nantel and director of innovation and development Débora Santschi spoke to dairy producers about butterfat, and what pays back, at the recent Southwestern Ontario Dairy Symposium in Woodstock.

Why it matters: Changes in payment method for non-butterfat solids in milk prompted many dairy farmers to explore ways to fine-tune their ratio to get a better price.

It’s referred to by Canadian dairy producers as the “SNF ratio” but it’s actually the ratio between solids-not-fat (SNF) and butterfat in milk shipped from the farm.

Some milk components within the SNF category are considered byproducts at many dairy processing facilities. They are often sold by the Dairy Farmers of Ontario marketing board at world market price for dairy ingredients, which is considerably lower than the price received for butterfat and other components in the domestic processing market. Some is also discarded as animal feed or waste.

Between July 2022 and February 2023 (in a two-step process), DFO addressed an ongoing SNF surplus by dropping its maximum SNF ratio for which producers are eligible for payment to 2.2 from 2.3.

Also on Aug. 1, 2023, a three-tier payment system was introduced, with SNF components falling within the 2.0 to 2.2 range earning 70 per cent of the world market dairy ingredient price and SNF components produced above the 2.2 maximum earning no return.

To those uninitiated by the intricacies of a DFO milk cheque, the obvious answer is to increase butterfat as much as possible. But dairy producers can be paid well for some of the non-butterfat components of their milk, and Jetté-Nantel and Santschi aimed to help them balance the equation.

Jetté-Nantel began by analyzing whether there’s an optimum SNF ratio for milk value under current component and blend prices.

Applying the 2.2 ratio to a theoretical farm, it’s assumed that if the farm had a ratio of 1.9 instead, there would be milk components it could ship and be paid for if the feeding program allowed for the 2.2 ratio.

If the farm had a 2.3 ratio, on the other hand, it would pay transportation charges on components it’s not getting paid for.

Producers must recognize that feed costs typically change if the farm’s SNF ratio is changed. With Jetté-Nantel’s 2.2 SNF ratio example, the feed cost was $6.98 per kilogram of milk and yielded a feed margin of $14. Dropping the SNF ratio to 1.9 and changing the feed required to make that change, the cost per kilogram of milk was 32 cents less and the feed margin increased to $14.25.

Productive cows are the goal of many feeding programs, the economist noted, but through conversations with dairy nutritionists, he was told it costs $3 to $4 to convert a kilogram of soybean protein into a kilogram of milk protein.

If it’s that expensive, Jetté-Nantel said, perhaps “you’d be better off not producing it.”

“That 2.2 (SNF ratio) where you’re maximizing production is not necessarily optimal” from a financial standpoint. “In the long term, you’ll probably want to be closer to (a ratio of) 2.0.”

Either way, achieving the optimal ratio requires an increase in butterfat. Santschi polled symposium attendees about methods of doing that and the most common response was use of palm fat.

She said there are expensive and not-so-expensive ways to achieve the goal. With feed additives, work the numbers to determine the optimal SNF ratio and “make sure (using a new feed additive) is going to pay back.”

Milk fatty acid analysis is a relatively new tool available to most nutritionists – and, increasingly to dairy farmers – to help guide butterfat-related decisions. Lactanet can do the tests and reports to producers include information about the industry average compared to the tested herd.

The hundreds of possible fatty acids are generally grouped into three types and if the milk is low in one of those types, the information can help determine where to concentrate efforts to increase butterfat.

Santschi showed an example of a milk fatty acid test that was low in one type, followed by a subsequent test conducted after palm fat was introduced to the ration. The subsequent test showed the three types of fatty acids closer to equal.

Another before-and-after example showed an increase in all types of milk fatty acids following installation of fans in the cow housing area. It showed that comfortable cows are more likely to show greater forage intake at the feed bunk, thereby increasing butterfat content in the milk. It also shows that management changes may be less expensive and equally as effective as feed additives.

Other potentially beneficial management changes relate largely to feed consistency and availability:

• Decrease stocking rates to eliminate competition at the feed bunk.
• Make sure the ration is consistent through the entire feed bunk, through changes to either feed mixing or feed delivery methods, or both.
• Make sure feed is consistently available throughout the day, either through increased feed pushing or more frequent feed delivery, or both.
• Good water quality is important for increased dry matter intake.

Even expensive management-related changes can yield better than feed additive changes over the long term, Jetté-Nantel said. He told of a Lactanet research review into climate projections in southern Ontario and Quebec dairy-producing regions.

In a possible model of 90 “heat stress days” per year in the London region by the 2030s, installation of fans in a dairy barn is predicted to lead to an average butterfat percentage increase from 3.5 to 4.5.

The payback for fan installation in that model is four years, the economist said.